Since then the repercussions of the story have been extraordinary, culminating yesterday in the surprise resignation of Sir Paul Stephenson, the commissioner of the Metropolitan police. Now there is even speculation that the affair could eventually bring down David Cameron. That seems utterly fanciful - although anyone who claimed to be able to predict with confidence exactly where this will end would be a fool.

• Met police commissioner Sir Paul Stephenson has resigned. In a parting shot to David Cameron he said the prime minister risked being "compromised" by his closeness to former News of the World editor Andy Coulson.

• Former News International chief executive Rebekah Brooks has been bailed after being arrested and questioned for 12 hours. She is due to return to a police station in October.

• David Cameron, who has been informed of Stephenson's decision, has cancelled plans to visit Rwanda and Sudan during his visit to Africa in order to return earlier to the UK.

• Labour leader Ed Miliband has called for new media ownership rules to limit Rupert Murdoch's "dangerous" and "unhealthy" concentration of power.

• An advert placed by News International in Sunday's national newspapers described how the company is "putting right what's gone wrong".

Today we'll be hearing more from Theresa May, the home secretary, about the resignation of Stephenson. She has already been giving interviews - I'll summarise them shortly - and she will make a statement in the Commons at 3.30pm.

Ed Miliband, whose reputation as Labour leader has been transformed by his adroit handling of the crisis, is giving a speech that will cover some of the wider implications at 11.30am. And the Commons culture committee, which is preparing for its historic hearing tomorrow, will have to take a decision about whether or not Brooks can appear following her arrest and release on bail yesterday.

But those are just the developments we can anticipate. No doubt, there may be some surprises too. I'll be focusing on phone hacking all day and bringing you all the latest developments.

8.34am: One of the key factors that seems to have led to Sir Paul Stephenson's decision to resign was the row about the Met's decision not to tell ministers that the force had employed Neil Wallis, the former deputy editor of the News of the World, until the end of last week. This is what Stephenson said about it in his resignation statement.

Now let me turn to the reported displeasure of the prime minister and the home secretary of the relationship with Mr Wallis.

The reasons for not having told them are two fold. Firstly, I repeat my earlier comments of having at the time no reason for considering the contractual relationship to be a matter of concern. Unlike Mr Coulson, Mr Wallis had not resigned from News of the World or, to the best of my knowledge been in any way associated with the original phone hacking investigation.

Secondly, once Mr Wallis's name did become associated with Operation Weeting, I did not want to compromise the Prime Minister in any way by revealing or discussing a potential suspect who clearly had a close relationship with Mr Coulson. I am aware of the many political exchanges in relation to Mr Coulson's previous employment — I believe it would have been extraordinarily clumsy of me to have exposed the Prime Minister, or by association the Home Secretary, to any accusation, however unfair, as a consequence of them being in possession of operational information in this regard. Similarly, the Mayor. Because of the individuals involved, their positions and relationships, these were I believe unique circumstances.

Consequently, we informed the chair of the MPA, Mr Malthouse, of the Met's contractual arrangements with Mr Wallis on the morning of the latter's arrest.

There has been some debate about what Stephenson meant by "compromising" the prime minister. My reading of this is that, by not telling Cameron that Wallis was a suspect, Stephenson thought he was ensuring that Cameron could not be accused of interfering with the investigation.

But, in her interview on the Today programme this morning, Theresa May, the home secretary, said that Stephenson should have told ministers earlier. I've taken her quotes from PoliticsHome.

I've been absolutely clear through out all of this, as has the prime minister, that the Metropolitan Police must investigate all allegations and take it as far as it goes and it is their job to do that, and to do that thoroughly and properly.

But, if the Metropolitan Police find at any stage that they have a potential conflict of interest, I think it's right for them to be transparent about that, and that's why I think it would have been right for us to have been told about the issue in relation to Neil Wallis at an earlier stage.

I made that absolutely clear to the commissioner last week that it had concerns about the fact that we had not been told earlier. I think that we should have been.

In her interview May also suggested that Tim Godwin, the deputy commissioner of the Met, would take charge until a new commissioner was appointed.

Photograph: Dan Kitwood/Getty Images

8.42am:Boris Johnson (left), the mayor of London, has just been on the Today programme. He said that, in the light of Sir Paul Stephenson's resignation, questions would now be asked about John Yates, the assistant commissioner of the Met, and his relationship with Neil Wallis. According to PoliticsHome, this is how Johnson put it.

The professional standards committee of the Metropolitan police authority is meeting this morning and I'm sure that questions surrounding other officers will be asked. I think John Yates has done a very, very good job on counter terrorism, I think he's been a very, very fine officer in that respect. Clearly there are now questions about his relationship with [Neil] Wallis and all the rest of it, and I'm sure that the MPA is going to be having a look at it.

8.50am:Kit Malthouse, the deputy mayor of London and chair of the Metropolitan police authority, has just told BBC News that he does not expect John Yates to resign.

8.52am: According to the Press Association, the Labour MP Tom Watson has reportedly written to the Serious Fraud Office asking officers to investigate payments allegedly made by News International to cover up the hacking scandal. The SFO said it will study Watson's letter when it arrives.

8.55am: News Corporation shares have fallen to a two-year low in Australia (where markets have been open all day, because of the time difference). My colleague Graeme Wearden has filed a story. Here's an extract.

Shares in News Corp fell as much as 7.6% on Monday on the Australian stock market as traders reacted to the resignation, and subsequent arrest, of Rebekah Brooks, and the resignations of Les Hinton, chief executive of Dow Jones and a key Murdoch ally, and Sir Paul Stephenson, the commissioner of the Metropolitan police.

In late trading, they were 4.2% lower at AUS$14.14, their lowest level since July 2009. News Corp's Australian shares have now dropped by nearly 20% since the crisis began on 4 July. News Corp's US-listed shares are expected to mirror the Australian losses when trading begins on Wall Street.

9.02am:Yvette Cooper (left), the shadow home secretary, is doing her best to use Sir Paul Stephenson's resignation to cast doubt on David Cameron's judgment. Here's an extract from the statement that she made late last night.

Ultimately Sir Paul has taken responsibility for a saga which he makes clear in his statement he had no direct involvement with from the beginning, because of the continued speculation around the appointment of Neil Wallis.

It is striking that Sir Paul has taken responsibility and answered questions about the appointment of the Deputy Editor of the News of the World whereas the Prime Minister still refuses to recognise his misjudgement and answer questions on the appointment of the Editor of the News of the World at the time of the initial phone hacking investigation.

On the Today programme this morning she made a slightly different point. According to PoliticsHome, here's how she put it.

It was interesting in what Sir Paul said yesterday that one of the reasons that he felt he clearly could not tell the home secretary, the mayor, downing street, about that contract that he had with Neil Wallis - he couldn't tell them because of the relationship between the prime minister and Andy Coulson. That seems to me to be unprecedented. I cannot think of any case where the police commissioner should not tell the home secretary because he was worried about the prime minister's relationship to somebody involved in the criminal investigation.

(Actually, Cooper is wrong about this. There is a precedent for the Met not being able to discuss operational details of an investigation with Number 10 because of Number 10's relationship with those under investigation - cash-for-honours.)

9.13am: Thank you to all the readers who have been posting links to interesting phone hacking-related articles that the rest of us may have missed. Here's a selection.

• David Carr at the New York Times says the crisis has cast doubt on Rupert Murdoch's approach to burying corporate problems (via apint4me).

"Bury your mistakes," Rupert Murdoch is fond of saying. But some mistakes don't stay buried, no matter how much money you throw at them.

Time and again in the United States and elsewhere, Mr. Murdoch's News Corporation has used blunt force spending to skate past judgment, agreeing to payments to settle legal cases and, undoubtedly more important, silence its critics. In the case of News America Marketing, its obscure but profitable in-store and newspaper insert marketing business, the News Corporation has paid out about $655 million to make embarrassing charges of corporate espionage and anticompetitive behavior go away.

• Johnlifebooks on his blog asks how cosy the relationship was between Rupert Murdoch and Bertie Ahern.

9.27am: David Cameron is in South Africa, where he is about to give a press conference with the president, Jacob Zuma.

9.28am: Ed Miliband is calling for parliament to sit on Wednesday, according to Sky, so that MPs can discuss the issues raised by tomorrow's culture committee hearing with Rupert and James Murdoch. At the moment tomorrow is meant to be the last sitting day before the summer recess.

9.31am:Brian Coleman, a Conservative member of the London assembly, has called upon John Yates to resign from the Met. Coleman has just put out this statement.

The commissioner has done the right thing by resigning, and accepting the error of judgement in employing Neil Wallis. [Assistant commissioner] Yates, who has shown that his stewardship of the original hacking enquiry was to put it bluntly, inept, should go, and go now. Sir Paul has set the example to follow. Until Yates has resigned and left Scotland Yard for the last time, the Metropolitan Police cannot hope to move on and restore confidence.

9.37am: Here is what Ed Miliband is going to say in his speech later this morning about extending the sitting of parliament for an extra day.

Rebekah Brooks has been arrested, the Metropolitan police commissioner has resigned, tomorrow we will have some of the most important select committee hearings in modern times and the prime minister has decided to leave the country, not to return until after parliament breaks up for summer.

In these circumstances the right and responsible thing for the government to do must be to extend the parliamentary session for at least 24 hours so the House of Commons meets on Wednesday. It would give MPs have the chance to debate the issues arising from the select committee hearings and ensure the prime minister answers the many unanswered questions that he faces.

Unless the government agrees to parliament meeting on Wednesday, MPs cannot do their jobs properly and the prime minister has no chance of sorting out this crisis.

9.43am: On Friday Rupert Murdoch struck an apologetic tone when he was filmed talking about his meeting with the parents of Milly Dowler. But, in private, what does he really think about what's going on. According to Andrew Neil (a former Murdoch executive), today's editorial in the (Murdoch-owned) Wall Street Journal sums it up best. As Neil says on Twitter, it's pretty defiant. Here are some extracts.

It is also worth noting the irony of so much moral outrage devoted to a single media company, when British tabloids have been known for decades for buying scoops and digging up dirt on the famous. Fleet Street in general has long had a well-earned global reputation for the blind-quote, single-sourced story that may or may not be true. The understandable outrage in this case stems from the hacking of a noncelebrity, the murder victim Milly Dowler.

The British politicians now bemoaning media influence over politics are also the same statesmen who have long coveted media support. The idea that the BBC and the Guardian newspaper aren't attempting to influence public affairs, and don't skew their coverage to do so, can't stand a day's scrutiny. The overnight turn toward righteous independence recalls an eternal truth: Never trust a politician ...

We also trust that readers can see through the commercial and ideological motives of our competitor-critics. The Schadenfreude is so thick you can't cut it with a chainsaw. Especially redolent are lectures about journalistic standards from publications that give Julian Assange and WikiLeaks their moral imprimatur. They want their readers to believe, based on no evidence, that the tabloid excesses of one publication somehow tarnish thousands of other News Corp. journalists across the world.

The prize for righteous hindsight goes to the online publication ProPublica for recording the well-fed regrets of the Bancroft family that sold Dow Jones to News Corp. at a 67% market premium in 2007. The Bancrofts were admirable owners in many ways, but at the end of their ownership their appetite for dividends meant that little cash remained to invest in journalism. We shudder to think what the Journal would look like today without the sale to News Corp ...

The political mob has been quick to call for a criminal probe into whether News Corp. executives violated the U.S. Foreign Corrupt Practices Act with payments to British security or government officials in return for information used in news stories. Attorney General Eric Holder quickly obliged last week, without so much as a fare-thee-well to the First Amendment.

The foreign-bribery law has historically been enforced against companies attempting to obtain or retain government business. But U.S. officials have been attempting to extend their enforcement to include any payments that have nothing to do with foreign government procurement. This includes a case against a company that paid Haitian customs officials to let its goods pass through its notoriously inefficient docks, and the drug company Schering-Plough for contributions to a charitable foundation in Poland.

Applying this standard to British tabloids could turn payments made as part of traditional news-gathering into criminal acts. The Wall Street Journal doesn't pay sources for information, but the practice is common elsewhere in the press, including in the U.S.

9.52am: The Cameron/Zuma press conference is starting now in Pretoria. As Nicholas Watt reports, Cameron's visit is about promoting trade, and the opening remarks are partly focusing on this. But I'll be concentrating on what Cameron has to say about the crisis in London.

9.57am: David Cameron is speaking now. He is talking about the strength of Britain's relationship with South Africa.

9.58am: In a "crisis", it is important to take "urgent and decisive action", David Cameron says. But he's not talking about phone hacking. He's talking about the famine in the Horn of Africa.

10.02am: The first question is from James Landale from the BBC.

Q: What is the difference between Sir Paul Stephenson employing Neil Wallis to do his PR and you employing Andy Coulson to do yours? Do you accept that your position would have been "compromised" if Stephenson had told you about Wallis? Was it right to come on this trip? And should John Yates resign?

Cameron says it is right for Britain to be engaged with South Africa and Africa as a whole.

He says he would like to thank Sir Paul Stephenson for the work he has done for the Met.

As he told Stephenson on Tuesday, the Met investigation must go wherever the evidence takes.

But the Met is not in the same position as the government. Public confidence in the Met has become an issue. The government has set up a judicial inquiry. It has demonsrated "transparency" in terms of media contact. Cameron himself has answered many questions on this.• Parliament should meet on Wednesday, Cameron suggests, so that he can make a statement to MPs updating them on his progress setting up an inquiry.

Theresa May is making a statement today, he goes on.

As for going on the trip, he says that just because he is in Africa, that does not mean he is not in contact with the evidence.

As for who should replace Stephenson, he says that is a matter for the Metropolitan police authority.

10.11am: Cameron is taking another question.

Q: Has your position been compromised? Was it a mistake to come to Africa?

Cameron says it is important for the prime minister to come to Africa with business leaders to promote business.

As for the police investigation, it should go wherever the evidence leads. He has said that publicly many times, and privately many times to the Met too.

That now needs to be taken forward by new leadership.

As for Andy Coulson, no one has argued that the work he did in goverment was bad.

The situation with the Metropolitan police is different. They had known of the relevant allegations for a long time.

Cameron says he is asking for parliament to sit on Wednesday so that he can make a statement to MPs. (He is more explicit than he was a few minutes ago, when he was only suggesting that parliament should sit on Wednesday.)

10.22am: Good work from the BBC's James Landale. Journalists travelling with the prime minister in South Africa initially thought that the British contingent would get just one question at the Cameron/Zuma press conference. In the event, two British journalists were called. But Landale, who was called first, made up for this by managing to get five questions in all in one go. Here are the key points.• Cameron revealed that parliament will meet on Wednesday to allow him to make a statement to MPs about the phone hacking affair. In response to Landale, Cameron said that extending parliament for an extra day (recess was meant to start on Tuesday afternoon) "may well be right". A few minutes later Cameron said he was calling for parliament to sit on Wednesday. If the prime minister is calling for this, then we can be confident that it is going to happen.

This is another win for Ed Miliband, who beat Cameron to it in calling for parliament to sit on Wednesday - albeit only by about 20 minutes. It is possible that Miliband may even have known in advance that Cameron was going to say this (because decisions about the timing of parliamentary business are discussed through "the usual channels"). But that doesn't really matter. Whether by deviousness or intuition, Miliband has - yet again - made it look as if Cameron is following his lead on this issue.

I think the situation in Metropolitan Police service is really quite different to the situation in government, not least because the issues that the Metropolitan police service are looking at and the issues around them have had a direct bearing on public confidence into the police inquiry into the News of the World and indeed the police themselves.

• Cameron defended his decision to travel to Africa while there is a crisis in London. "Just because you are travelling to Africa doesn't mean you've lost contact with your office," he said.

10.43am: According to the BBC's Nick Robinson, who has posted a blog on this, John Yates was in charge of carrying out "due diligence" on the former News of the World deputy editor Neil Wallis before the Met decided to hire him on a part-time basis to give PR advice.

I understand that Yates received categorial assurances from Wallis that nothing would emerge that would embarrass either of them or the commissioner.

The Met took the view that Wallis had never been "in the frame" over phone hacking - a view that only changed more than a year later when News International revealed new information at the beginning of this year.

Robinson says that Yates has no intention of resigning. The Metropolitan police authority is expected to look into Yates's conduct in this matter. But Robinson says that such inquiries are relatively routine and that they do not normally lead to senior officers being suspended.

10.47am: The Metropolitan police authority will make a a statement about John Yates at about 12.30pm, the BBC reports.

One likely consequence would be what Corporate Crime Reporter's Russell Mokhiber calls "a wishy-washy non-prosecution settlement" wherein News Corp would admit to the crime without being convicted, and pay a financial settlement. Mokhiber noted that, in a 2008 [Foreign Corrupt Practices Act] case against Siemens for widespread bribery, Siemens paid $800m but avoided a criminal conviction that would have jeopardised its standing as a US defence contractor.

As for the alleged phone hacking of 9/11 victims, if News of the World employees did engage in illegal attempts to access voicemails, and the FBI investigation can ferret out sufficient proof to seek indictments, then the most likely outcome would be extradition requests against the alleged offenders, which could drag on for years.

Investors in BSkyB have told the Financial Times they are reserving judgment on whether James Murdoch should stay as chairman until he has given evidence to the media committee tomorrow. One investor said:

We think we should have a non-Murdoch chairman, but we'll wait to see what Tuesday brings. Having said that, I would be more worried if I was a News Corp shareholder. In the States, there is more than a sense that things aren't real till they've happened on television.

[Most] dangerous is that the prime minister may appear in voters' eyes to have some dodgy friends and look just as bad as the Labour lot, part of the old rather than the new politics.

The same thing happened to Tony Blair, although it took longer … This crisis has understandably shaken the Cameron circle. Some dared to hope the storm had passed their door last week when the prime minister announced the judicial inquiry and disclosed his contacts with the media, a welcome burst of transparency. Yesterday they realised the storm is still gathering pace. It could last for years. No one knows where it will end, least of all Mr Cameron.

The public may be disgusted by illegal and immoral practices among tabloid journalists, and dismayed by the thought of politicians unbalanced by the urge to keep the favour of newspaper executives. At the point at which this sorry tale touches the police, however, it becomes frightening. Unless a huge amount of what has been alleged these past two weeks is sheer fiction, Britain's police are riven with corruption on an institutional scale. Journalists who bribe policemen are indicative of a flawed industry. Policemen who can be bribed are indicative of a flawed state.

The Sun, also a News International paper, has a page on hacking, but points out in a piece on the arrest of Rebekah Brooks:

She was NOT quizzed over anything to do with the Sun, which she edited from 2003 until 2009.

The Daily Star goes with "Becks: I was hacked", reporting that David Beckham fears his phone was hacked over the course of a decade and that he is "threatening to launch a multi-million-pound law suit", according to "pals".

10.51am: Boris Johnson, the mayor of London, and Kit Malthouse, his deputy and chair of the Metropolitan police authority, are holding a press conference this afternoon at around 2pm, I've just been told.

10.55am: My colleague Vikram Dodd says the Metropolitan police authority's professional standards cases sub-committee is meeting now in private. It is believed to be discussing John Yates. As the BBC have already reported, the MPA is expected to make a statement at about 12.30pm.

Stephenson went for not knowing the full truth of investigation. Yates - who failed to open the bags of evidence - must go too

11.11am: Ed Milband has been widely praised for his handling of the phone hacking crisis. He has repeatedly led where David Cameron has followed (as he did today, over the matter of getting parliament to sit on Wednesday - see 10.22am), and, as the Independent on Sunday reported yesterday, he has been rewarded with increased poll ratings.

But, in a commentary for YouGov, Peter Kellner says the true picture is a bit more complicated than this. Miliband's approval ratings have gone up, Kellner says, but this has not particularly helped Labour. Why? Here's Kellner's explanation.

Why has the marked improvement in Miliband's rating not lifted Labour's support? Partly because there has been no matching decline in Cameron's rating. There is no sign of growing disenchantment among Tories with the Prime Minister.

There is, though, another point. Throughout May, Miliband's net rating hovered around minus 20. In June it slid below minus 30 – but Labour's support did NOT fall. Miliband's rating is back to where it was two months ago and, again, Labour's support remains fairly constant.

In other words, the link between Miliband's and Labour's ratings is not a simple one. At his worst, when only 26% thought he was doing badly, he lagged well behind the Labour Party, which held the support of a fairly constant 33% of the total electorate (that is, including the don't know and won't votes: its 42% vote share reflects its support just among those who name a party).

What has happened is that Miliband's rating has recovered to the point where he is almost as popular as his party.

11.22am: My colleague Robert Booth has been speaking today to the owner of Champneys, the health spa where Sir Paul Stephenson stayed while he was recuperating from an operation on a £12,000 freebie. He's sent me this.

Graham Turner/Guardian

Stephen Purdew, the owner of Champneys, has said he personally invited Sir Paul Stephenson, the Metropolitan police commissioner, to convalesce at his luxury spa in Hertfordshire and the arrangement did not involve Neil Wallis, the former News of the World executive who did public relations for both men. Purdew said the weekend scandal around Stephenson's 20-night stay earlier this year with accommodation costs covered by the spa was his (Purdew's) fault because he was "lax about the account bill".

"I invited him and he wanted a bill, but I didn't get around to giving him a bill," he told the Guardian this morning. The cost was thought to amount to as much as £12,000.

Purdew said he has known Stephenson and his family for 20 years and invited him to recover from illness at the Tring health farm after he learned the police commissioner was having to travel 15 miles a day in a car to access physiotherapy. "He was not well, when he arrived at Champneys he was in a wheelchair and when he left he was walking," said Purdew. Stephenson paid for his own treatments during the stay, Purdew said.

Purdew confirmed that he used Neil Wallis as a public relations advisor "two or three times on my account" but said: "I did not know that the two of them [Wallis and Stephenson] knew each other."

11.28am: My colleague Alan Travis says the Home Office is expected to publish Theresa May's correspondence with Sir Paul Stephenson when she makes her Commons statement this afternoon. The three letters are believed to include her original letter on Thursday asking for an explanation of the NeilWallis disclosure, Stephenson's reply and her response to it, Alan says.

11.30am: John Yates doesn't seem to be in the mood to quit. According to Sky News, he has said: "I've done nothing wrong."

11.35am: John Yates has been called to give evidence to the home affairs committee tomorrow. Sir Paul Stephenson, the outgoing Metropolitan police commissioner is giving evidence (he was invited before his resignation on Sunday, but he will still be appearing) and Dick Fedorchio, director of public affairs at the Met, is appearing too.

Keith Vaz, the committee chairman, said: "The committee has recalled Mr Yates to give evidence tomorrow to clarify aspects of his evidence that he gave to the committee last week and following the statement of Sir Paul Stephenson."

11.42am: And Rebekah Brooks will definitely be giving evidence to the Commons culture committee, according to the BBC's Robert Peston. There had been speculation that she might not appear because she was arrested yesterday and questioned before being released on bail. But Peston says on Twitter her spokesman has confirmed that she will showing up.

11.48am: My colleague Vikram Dodd has sent me more about the meeting of the Metropolitan police authority's professional standards cases sub-committee taking place at the moment.

Graham Turner/Guardian

John Yates is not at the meeting, which is being held in private. The sub-committee is considering a complaint about him, it's believed. They do not have the power to dismiss him, but they could ask for a further investigation.

The Metropolitan police authority is currently holding a meeting to discuss Mr Yates' handling of the phone hacking affair and his links with Mr Wallis, a former senior executive at the News of the World.

It is understood the authority has decided to hold an investigation into the assistant commissioner. It is expected he will be asked to step down while this investigation is carried out.

A source close to the mayor told The Daily Telegraph: "If an investigation is ongoing he cannot stay in his job."

11.59am: My colleague Hélène Mulholland was at the Number 10 lobby briefing this morning. She's sent me this.

Guardian

Downing Street is to reissue the list of meetings David Cameron had with senior executives at News International.

"There will be a few updates because there are omissions", a spokeswoman said. But she added that there were unlikely to be "any great surprises" given press speculation over the weekend. This would cover proprietors, editors and senior executives.

A list of similar meetings between cabinet ministers will also be published "as soon as they are ready", the spokeswoman said at at the morning lobby briefing.

The spokeswoman also confirmed that the prime minister will recall the Commons on Wednesday to update MPs on the latest developments on the phone hacking scandal. But there will be no PMQs.

A spokeswoman said the prime minister felt it was important to "bang the drum" for British business by going ahead with his trip to Africa - a trip that has nonetheless been cut short by two days. Cameron will make a statement at 11.30, a day after parliament was due to rise for the summer.

The spokeswoman for the Prime Minister confirmed that he had no warning from Sir Paul about his intention to quit.

"The Prime Minister was not aware of Sir Paul's decision or desire to resign before he heard that statement (last night)," she added.

12.07pm: Ed Miliband is delivering his speech about the ramifications of the phone hacking affair now. I'll post a full summary when I've read the whole text, but Miliband has already said that having a statement from David Cameron on Wednesday about the affair will not be satisfactory. Miliband wants a full debate.

12.09pm: My colleague Vikram Dodd has sent me more about the meeting of the Metropolitan police authority's professional standards cases sub-committee.

Graham Turner/Guardian

The sub-committee is considering complaints against John Yates over his handling of the phone hacking case. One complaints relates to this decision in July 2009 that the investigation should not be re-opened. The other relates to his involvement in the decision to approach Neil Wallis about a senior communications job in the force.

The committee does not have the power to suspend an officer of ACPO rank. It can either dismiss a complaint, or refer it to the Metropolitan police's directorate of professional standards or the Independent Police Complaints Commission for further consideration or investigation.

12.16pm: My colleague Paul Owen has been roaming the blogosphere for comment on the phone-hacking scandal and the fallout from the crisis.

At LabourList, in a post entitled "I told you so", Luke Akehurst crows that "Ed [Miliband]'s handling of the phone hacking scandal and his courage in putting his neck on the line to take on News International has vindicated the trust that I and a majority of Labour's electoral college put in him last September".

Not entirely convincingly, Akehurst says it is now "amusing" to see how "badly flawed" the judgment of Miliband's critics was. But he says he is not going to rub it in: "a simple 'I told you so' will suffice".

Akehurst may be speaking too soon. As Andrew Rawnsley wrote in the Observer yesterday, Miliband "still has lots of work to do to turn himself into a rounded, engaging and authoritative personality in the eyes of the public. What he has gained from this is an opportunity to be heard with enhanced respect on other subjects."

It's the Blairites - Tony Blair, David Cameron, Peter Mandelson, George Osborne, and Michael Gove etc - who are going to be most affected because they are closest to News International. No more "heir to Blair" talk! These are the losers.

A lot more information will come out in the inquiries which will show like on just how friendly certain New Labour figures were with News International. A lot of these old faces will have to ejected in favour of new ones.

The winners in all this will be the non-Blairite Tories like David Davis.

The non-Blairite Labour MPs like Tom Watson and the clean new ones like Chuka Umunna and Sadiq Khan are winners. Ed Milliband also wins.

The Lib Dems are winners, Clegg is rejuvenated and more powerful, so is Simon Hughes.

At Labour Uncut, Labour MP Michael Dugher argues that "David Cameron's weak flat-footed handling of the phone-hacking scandal ... appears in marked contrast to his response to the MPs' expenses crisis three years ago. During that period, as leader of the opposition, Cameron gave the impression of understanding immediately the level of public anger and he was constantly trying to be on top of the story by calling for action. In contrast, in recent weeks, Cameron has been completely reactive, looking like he has been in denial as to the depth and scale of the crisis."

He's been caught palling up to someone that appears to have been ultimately responsible for hacking the phones of murdered schoolchildren and bribing policemen (and who says that there is much worse to come), and for hiring someone else apparently involved, and his response has been "The Political System made me do it! We have all been guilty of becoming too friendly with the media. The culture needs to change!" For goodness' sake grow some cajones, man! Take a little personal responsibility. Alistair Campbell and Peter Mandelson didn't make you become involved with these people. You chose that for yourself.

These papers are (sequentially) a national paper of record, a great exposer of scandals and righter of wrongs, and a cheap and cheerful way of brightening up many peoples' mornings (you can always skip past page three if it offends). If they were to stop publishing, they would be missed. If they were put up for sale, who would be a 'fit and proper person' to buy them? With the state of the UK economy being what it is, the odds are that any potential purchaser would either hail from somewhere far abroad, or be engaged in a form of commercial activity which would be less than appealing to those who are currently lining up to put the boot in to the Murdochs.

On his blog, the BBC's political editor Nick Robinson writes that Assistant Commissioner John Yates was the man tasked with carrying out "due diligence" before the Metropolitan police awarded a contract to the firm run by Neil Wallis in 2009.

I understand that Yates received categorical assurances from Wallis that nothing would emerge that would embarrass either of them or the commissioner.

The Met took the view that Wallis had never been "in the frame" over phone hacking - a view that only changed more than a year later when News International revealed new information at the beginning of this year …

Yates, I'm told, has no intention of resigning and would only do so if his judgement is found wanting by the official inquiry led by Judge Leveson.

12.20pm: According to the BBC's Robert Peston, it is likely that James Murdoch will be asked to stand down temporarily as chairman of BSkyB by the end of this week. Peston has written this up on his blog. Here's an extract.

According to a well-placed source, there is a growing view among the company's non-executives that the burden for James Murdoch of "fighting the fires" at News Corporation - where he is in charge of European operations and is deputy chief operating officer - means that he will find it hard to devote enough time to chairing BSkyB, the largest media and entertainment company in the UK.

The likelihood is that he will be asked to stand down as chairman at least temporarily, until News International - the UK arm of News Corporation - has been stabilised.

If he were to step down pending resolution of the crisis at News Corporation, it is likely he would be replaced by BSkyB's senior non-executive director, Nick Ferguson - who in effect played that role in BSkyB's board discussions over News Corporation's attempt to purchase all of BSkyB.

12.25pm: Ed Miliband is now taking questions.

Q: Do you think David Cameron should resign?

Miliband says he asked Cameron to apologise for hiring Andy Coulson. Cameron has not apologised. There is a sharp contrast between Sir Paul Stephenson's decision to resign over the hiring of Neil Wallis and Cameron's handling of this issue.

Cameron has many questions to answer. He is unable to provide the leadership the country requires.

Q: Should John Yates resign?

Miliband says there is a cloud hanging over Yates. But it is up to the Metropolitan police authority to decide his future.

12.28pm: My colleague Vikram Dodd has called to say that there is a rumour doing the rounds in police circles that John Yates is going to make a statement this afternoon.

12.31pm: Another Guardian colleague tells me that he has heard from a source who is normally reliable that John Yates will resign later today. I'm sorry I can't tell you any more. This is not confirmation that he will definitely go, but - knowing a bit more about where this is coming from than I'm in a position to disclose - I'm taking it very seriously.

12.38pm: Rebekah Brooks's lawyer is making a statement now on Sky News now. He says she is "not guilty of any criminal offence". He goes on:

The position of the Metropolitan police is less easy to understand. Despite arresting her yesterday, and conducting an interview process lasting nine hours, they put no allegations to her and showed her no documents connecting her with any crime.

They will in due course have to give an account of their actions, and in particular their decision to arrest her with the enormous reputational damage that this has involved.

Brooks remains willing to attend the select committee tomorrow, the lawyer goes on. He says it is for parliament to decide if the hearing should take place at a later date.

12.45pm: A moment ago Rebekah Brooks's lawyer said it was for parliament to decide if tomorrow's hearing should still go ahead. (See 12.38pm.) Well, they've decided. The culture committee has just sent out a note about the hearing with the running order. Rupert Murdoch and his son James will be up at 2.30pm. And Brooks will be on at 3.30pm.

12.51pm: News Corporation is going to announce more details of the management and standards committee it is setting up to clean up News International, according to Sky's Mark Kleinman. On his blog, Kleinman says a senior British barrister will be in charge.

12.58pm: My colleague Vikram Dodd says Deborah Glass, deputy head of the independent police complaints commission, has just arrived at the meeting of the Metropolitan police authority's professional standards cases sub-committee.

1.05pm: Here's a lunchtime summary.

• David Cameron has announced that the House of Commons will delay its summer recess by a day to allow Cameron to make a statement to MPs about phone hacking on Wednesday. Cameron made the announcement only about 20 minutes after Ed Miliband publicly called for a one-day extension. Miliband later said that a statement would not be enough, and that MPs should have a full debate.

• John Yates's future as a Metropolitan police assistant commissioner seems to be hanging in the balance. The Metropolitan police authority's professional standards cases sub-committee has been discussing his conduct in relation to the phone hacking affair this morning and Boris Johnson, the London Mayor, and Kit Malthouse, the chairman of the Metropolitan police authority, are due to give a news conference this afternoon. Vikram Dodd has just told me that the MPA will issue a statement at 1.50pm. There have been reports claiming that Yates will be suspended. One source has told the Guardian that Yates will resign, although the BBC are reporting that sources close to Yates insist that he is not quitting.

• Ed Miliband has accused Cameron of being "hamstrung by his own decisions" because Cameron gave the former News of the World editor Andy Coulson a job in Downing Street. Miliband and other members of the shadow cabinet are not openly calling for Cameron's resignation. But they are coming close, because they have been suggesting that it was unfair for Sir Paul Stephenson to have to resign over the Met's decision to hire a former NoW executive when Cameron also hired a former NoW executive. Here is how Miliband put it in his speech.

It is of great concern, however, that the Commissioner of the Metropolitan Police was unable to discuss vital issues with the Prime Minister because he felt that David Cameron was himself compromised on this issue because of Andy Coulson.

It is also striking that Sir Paul Stephenson ha s taken responsibility and resigned over the employment of Mr Coulson's deputy, while the Prime Minister hasn't even apologised for hiring Mr Coulson.

We need leadership to get to the truth of what happened.

But David Cameron is hamstrung by his own decisions and his unwillingness to face up to them.

• Miliband has said the phone hacking crisis should be a moment that will "bring about a far greater sense of responsibility in our country". Although his speech was mainly about phone hacking, it had some wider implications. I'll post more about it shortly.

• Rebekah Brooks has confirmed that she is willing to give evidence to the Commons culture committee tomorrow. The committee are not in a mood to cancel. They have published a timetable saying that Rupert Murdoch and his son James will give evidence at 2.30pm, and Brooks at 3.30pm. The home affairs committee has also summoned John Yates to give evidence tomorrow, alongside Stephenson and Dick Fedorchio, director of public affairs at the Met. (See 11.35am.)

1.31pm: It would be nice to know what Paul Dacre, editor of the Daily Mail, has to say about all this. And we may find out. Dacre is giving evidence to a committee in the Lords today. It's about the draft defamation bill, but an imaginative peer may decide to ask about the impact of the bill on, for example, a paper reporting allegations about phone hacking. Dacre is giving evidence at 4.35pm.

1.38pm: BSkyB does not expect James Murdoch to step down temporarily as chairman, despite what Robert Peston is saying (see 12.20pm). My colleague Lisa O'Carroll has sent me this.

BSkyB today said it did not expect James Murdoch to be pushed as chairman of the board despite a growing view among non-executive directors that his position may be untenable.

It said it had "no specific comment" to make about claims by the BBC's Robert Peston that the non-executives felt Murdoch was "fighting the fires" at News Corporation - where he deputy chief operating officer.

A spokesman said there were no moves afoot on the make-up of the boardroom: "The company has a strong governance framework and there are no changes to the existing plans."

1.41pm: But if James Murdoch were to temporarily stand down as chairman of BSkyB, who would replace him? My colleague Jill Treanor has sent me this.

Nicholas Ferguson, deputy chairman and senior independent director of BSkyB, is the existing boardroom member that investors would expect to step up to be temporary chairman of the satellite company if James Murdoch steps aside. "He's the first person we go to," one investor said. This is because his role as senior independent director - or sid - is special as it makes him the main point of contact for shareholders when they are concerned about directors of a company, rather going to their more usual contacts such as the chairman or the chief executive. Some major City investors are said to have contacted Ferguson directly to ensure he is aware of the concerns about Murdoch's position as a chairman.

For some investors this is a major opportunity as they have long-harboured anxieties about someone connected to the largest shareholder - News Corp - holding the role of chairman. "You wouldn't ever want your largest shareholder as chairman and that's something the non-executive directors are going to have to consider very verycarefully," one investor said. "Ferguson would likely be the chairman on a part-time basis," this investor said.

Others are saying they are still waiting for information and are not aware of any imminent changes to the board.

1.55pm: The statement from the metropolitan police authority about John Yates will now come after Boris Johnson's press conference, my colleague Vikram Dodd tells me.

2.13pm: John Yates has resigned, Vikram Dodd tells me.

2.15pm: Bob Ainsworth, the former Labour defence secretary, is one of the first MPs to respond to Yates's resignation on Twitter.

Yates . About time he is the one who should have gone long ago.

2.17pm: The Boris Johnson press conference will be starting in a moment. My colleague Paul Owen will be taking over the blog for a while, but I'll be back before 3pm.

Assistant Commissioner John Yates has this afternoon indicated his intention to resign to the chair of the MPA [Metropolitan police authority]. This has been accepted. AC Yates will make a statement later this afternoon.

2.25pm: Boris Johnson, the mayor of London, is speaking now about the resignations of Sir Paul Stephenson and John Yates:

I believe that both decisions are regrettable but I'm afraid that in both cases the right call has been made.

He pays tribute to Yates and his job "leading the fight against terror". Millions of Londoners are safer because of him, he says.

Cressida Dick will replace him in the interim, Johnson says.

2.27pm: He also pays tribute to Stephenson's work "in very tough financial times".

Tim Godwin will replace him in the interim and Johnson is working with the home secretary to find a permanent replacement.

Vikram Dodd sends this on John Yates:

The MPA disciplinary committee, which met this morning, announced that it had decided to suspend AC Yates pending an inquiry into allegations following the phone-hacking scandal. The MPA professional standards subcommittee met in private this morning and reached its decision to suspend the most senior counter-terrorism officer in Britain.

2.31pm: Johnson is asked if he demanded Stephenson's resignation.

In an ideal world Paul Stephenson would still be commissioner of the Metropolitan police service ... The trouble was that he had been caught up in a series of decisions relating to the Met's handing of the News of the World which were going to be extremely distracting.

What Paul really couldn't face was the idea of this protracted inquiry ... at a time when he wanted to concentrate on policing in London.

Of course I was reluctant ... but I accept the force of that argument.

He says he was "disappointed" to discover the relationship between the Met and Neil Wallis.

2.34pm: Did Johnson or his deputy ever have meetings with the police where Neil Wallis was present? Both Johnson and Kit Malthouse say no.

2.35pm: Johnson says that in the past – before this last two weeks – when phone-hacking allegations had come out Yates had told him there was "nothing new" and "nothing at the end of the rainbow", and Johnson took him at his word. He says he asked the police if there was anything he could do regarding his own phone being hacked, and was told there wasn't. He says of News of the World journalists who hacked into his phone:

I'd be thrilled to see them locked up. Nothing would give me greater pleasure.

2.39pm: Johnson says new information has only come out from the beginning of this year so Yates's contention that he should not reopen the investigation in 2009 was right.

2.41pm: Was there any element of the relationship between the police and the NoW that somehow impeded them from pursuing the phone-hacking inquiry – particularly the relationship with Neil Wallis, Johnson asks rhetorically. He says he has no evidence that was the case but that is what he hopes the police and judicial inquiries will find out.

2.42pm: Here's a fuller quote from Johnson on the two police resignations:

I believe that both decisions are regrettable but I would say that in both cases the right call has been made. There is absolutely nothing that has been proven against the probity or the professionalism of either man.

But in both cases we have to recognise that the nexus of questions about the relationship between the Met and the News of the World was likely to be distracting to both officers in the run-up to the Olympic games.

2.44pm: Johnson says Ken Livingstone's administration never "kicked up a fuss" about the original phone-hacking allegations or Rebekah Brooks admitting paying police in 2003.

2.45pm: Johnson and Malthouse are asked if they should be considering their positions, on the grounds of allowing this crisis to develop at the Met under their watch. Johnson does not directly answer.

I'm not in operational charge of investigations by the Metropolitan police, Johnson says in answer to the next question.

2.47pm: Johnson and Malthouse both say how "sad" it is that Stephenson has had to resign. Malthouse says he has "fallen on his sword for reasons of honour ... That is to be admired."

2.48pm: My colleague Hélène Mulholland asks if Johnson regrets his praise for Murdoch made when the Milly Dowler revelations first broke – see below.

Well, clearly what the News of the World did was absolutely loathsome and I condemn it - I'm very glad that this gives everybody the opp to get to the bottom of practices across Fleet Street.

Many tabloids have used tactics like that, he says.

All papers should come before Judge Leveson and talk under oath about practices in their newsrooms.

On Murdoch: "I do think what has happened now has been absolutely disgraceful but he made in the 1980s a substantial contribution to liberating newspapers", and satellite broadcasting advanced the media, Johnson says.

Asked about his comment last year that the phone-hacking allegations were "codswallop", he says he was making it based on what he knew then, and says if new facts came up he would change his mind. "It became obvious the scandal was far worse than previously indicated."

"Nauseating, loathsome practices" were revealed

"Those who pursued the story have been completely right," he says.

Do you apologise for having mocked them?

No ... You have top go on the advice you're given... The advice I was given was there was nothing new and you can see the consequences of that bad advice today.

Johnson's position on phone hacking has undergone a swift change of course as the phone-hacking allegations have widened into a full-blown crisis for News Corporation, the Metropolitan police. Last year he called the revelations "a load of codswallop cooked up by the Labour party" and "a song and dance about nothing" that had been "whipped up by the Guardian and the Labour party". But since the Guardian revealed that the News of the World had hacked Milly Dowler's phone and deleted some her messages his views have changed; he called these revelations "deeply sick" and demanded a judge-led inquiry.

Of course, it may be argued that the revelations about Milly's phone took the scandal into new and much more serious territory – although that doesn't make Johnson's characterisation of the original revelations as "codswallop" any more accurate. But, as Dave Hill notes on his London blog, there has been little coverage so far of the question of whether Johnson "should have made it his business to ensure the Met got to grips with the phone-hacking issue".

It isn't good enough for Boris to simply note with regret the "crap" past decisions of the Met and stealthily distance himself from them. He is a mayor who came to power promising to take "personal responsibility" for policing, placed himself in the chair of the Metropolitan police authority and wasted little time in forcing Sir Paul [Stephenson]'s predecessor to resign. The immediate intensification of the anti-street crime initiative Operation Blunt 2 showed a service responding to mayoral demands. But while Boris has been prepared to muscle the Met when it suits him, he has been equally quick to duck out of sight when it doesn't.

Hill also suggests that Johnson might be playing the hacking allegations down because, as a phone-hacking victim himself, he has had a "long-standing reluctance to assist in any prosecution that might entail details about his private life being once more dragged into the limelight".

Here are some of the key quotes from Johnson about the phone-hacking affair (with thanks to my colleague Lisa O'Carroll).

Wednesday 15 September 2010

Johnson dismisses the phone-hacking allegations against the News of the World as "codswallop" and "a politically motivated put-up job by the Labour party", and says he was "satisfied" by the Metropolitan police's investigation of the matter.

Thursday 7 July 2011

Johnson describes the revelations about the hacking of Milly Dowler's phone as "deeply sick" and calls for a judge-led inquiry. But he says that what Rupert Murdoch has done for British journalism over the last 40 years "is actually very considerable".

Wednesday 13 July 2011

Johnson gives his backing to Assistant Commissioner John Yates, saying it is "vital" he is allowed to continue doing his job.

Monday 18 July 2011

2.58pm: Johnson says he was far more interested in what Yates had to say about counter-terrorism than phone hacking.

2.58pm: You just effectively sacked two of the most senior officers in London, the mayor is told.

"Yeah ... That's not an operational matter," Johnson says. And with that the press conference is over.

Graphic

3.05pm: It's Andrew Sparrow, taking over again from Paul Owen.

Tom Brake, the Lib Dem MP who co-chairs his party's parliamentary committee on home affairs, justice and equality, has just put out this statement about John Yates's resignation.

Once Sir Paul Stephenson resigned, it became inevitable that John Yates would step down as well, given his close connections to the original investigation.

We must hope that the purge among the highest ranks is now complete.

We now need urgent action to rebuild London's senior police team so they are in post and able to rebuild the Metropolitan Police's credibility and be ready for their biggest challenge next year, the security arrangements for the Olympics.

3.11pm: Lord Grabiner QC is going to chair the independent committee being set up by News Corporation to oversee the clean up operation at News International. Here's an extract from the statement issued by the company.

News Corporation today confirmed the formal establishment and extension of the mandate of the Management and Standards Committee (MSC) as an independent body outside of News International.

The MSC is also delighted to confirm the appointment of Lord Grabiner QC as its independent Chairman.

Lord Grabiner, 66, is a commercial lawyer who has more than 40 years of experience of high-profile litigation. In addition he is a well-known and widely-respected figure in the banking, finance, academic and business worlds.

The MSC will report directly to Joel Klein, Executive Vice President and News Corp Board director, who in turn will report to Viet Dinh, an independent director and Chairman of News Corp's Nominating and Corporate Governance Committee. Both will update the News Corp Board of directors which has given the MSC its full support ...

The MSC is authorised to co-operate fully with all relevant investigations and inquiries in the News of the World phone hacking case, police payments and all other related issues across News International, as well as conducting its own enquiries where appropriate.

It will also be responsible for proposing and overseeing the implementation of new compliance, ethics and governance procedures at News International.

3.15pm: Michael Wolff, Rupert Murdoch's biographer, has given an interview to ITV saying that he thinks Murdoch will perform very badly when he gives evidence to the Commons culture committee tomorrow.

He will handle it very poorly. This is something that Rupert doesn't know how to do, has never done, has resisted doing and frankly can't do. Rupert is – on top of everything else - an incredibly shy man and he is also a very inarticulate man and he is also a man who, I don't think he is going to know what to do with the fact that he will be confronted here. It is very likely he will get angry. He will say things that people should not say in public. I know they are drilling him and rehearsing him over and over and over and over again and they are saying to him 'do not say anything, just answer the questions in as few words as possible'. Whether he absorbs that lesson or not…actually I can't imagine that he will or that he has.

3.18pm: Laura Elston, the Press Association journalist who was arrested as part of the phone hacking inquiry, faces no further action, her lawyer said today. My colleague James Meikle has sent me more details.

Laura Elston, 34, who works for the Press Association news agency, was held for several hours on June 27 when she voluntarily went to a central London police station. Her solicitor David Corker said he had been told she faced no further action: "She has been dropped from the inquiry."Scotland Yard confirmed a 34-year-old arrested in June had had her bail cancelled and told she faced no further action.Elston had been questioned on suspicion of intercepting communications, contrary to Section 1 of the Regulation of Investigatory Powers Act (RIPA) 2000, and was the only journalist arrested so far with no known News International links.Elston works as a royal correspondent and was originally released on police bail until October. She joined the organisation as a graduate trainee in 2000.PA editor Jonathan Grun said: "Laura Elston is a journalist of integrity who has had a distinguished career since joining us as a trainee more than a decade ago. We are pleased that this matter has been cleared up."She was interviewed by detectives on Operation Weeting, the investigation launched by the Metropolitan Police in January following new allegations of phone hacking.According to the Sunday Mirror , Elston was arrested on suspicion of hacking the voicemails of Prince Charles's spokesman Paddy Harverson. The allegation related to Elston's phone being used to call Harverson when they were both in Lesotho in 2006.The paper said it understood Harverson told police he borrowed her phone to access voicemails because his own mobile was not working. Clarence House was reportedly satisfied Elston did nothing criminal and told detectives Elston was innocent.Clarence House declined to comment on the claim on Monday.

3.19pm:Ed Miliband's speech this morning will probably receive zilch coverage in the light of everything else happening, but it is worth reading. The full text is on the Labour party website. At one point I thought I heard a faint echo of the speech that Tony Blair gave when he was shadow home secretary about the murder of James Bulger. Blair said the killing was a hammer blow "against the sleeping conscience of the country" - an event that should have prompted wider reflection on what was going wrong with Britain. I've already quoted what Miliband said about David Cameron. (See 1.05pm.) Here are the other main points.

• Miliband said the phone hacking scandal should lead to people taking more responsibility.

I want to talk today about how we ensure this is not a brief moment which people will look back upon and wonder what was that all about. Instead, I want to ensure this is a moment which will bring about a far greater sense of responsibility in our country. In particular, a new era of responsibility among the most powerful in our country.

• He said the crises that have affected banking, politics and the media have common factors.

The banker who paid himself millions of pounds for taking the most risky investments which would land his company and the country in the mire.

The MP who fiddled the expenses system, landing himself, his party and our politics in disgrace.

The editor of a newspaper which had a culture of illegality not for the public interest but simply in the search for sales, landing their paper and the whole industry in the dock.

All are about the irresponsibility of the powerful.

People who believed they were untouchable.

This issue of responsibility is one which must be tackled throughout British society.

From top to bottom.

The failure of our country to recognize and encourage responsibility isn't just bad for fairness or people's sense of right and wrong.

It's also holding Britain back in profound ways.

• He said Labour wanted to promote responsibility by breaking up monopolies. On Sunday it was revealed that Miliband would use the speech to call for tighter laws on cross-media ownership to break up Rupert Murdoch's media empire. Miliband did this (although he did not go into details). But he also said other monopolies should be broken up.

We should all find the courage to challenge other areas where concentrations of power damage our country.

Six energy companies control 99.9 per cent of the consumer market.

This cannot be right and we must take action to open up the market over the coming months.

• He said attacking monopolies was not anti-aspirational. This seemed to be a response to Tony Blair, who in his memoirs argues that Labour figures like Ed Balls do not understand aspirational voters.

There was a time when criticising people at the top was seen as being anti-aspirational.

But now, when irresponsibility at the top is holding Britain back and corroding our culture, it is our duty to speak out.

Anything else would, frankly, be anti-aspirational.

The task for all politicians is to speak directly to the concerns and common decency of the British people.

3.26pm: Here is a Guardian video with clips from what John Yates has said in his past appearances before Commons select committees.

Well, Boris certainly looked shaky in his press conference today; if this were anyone else we would be writing that his position is under threat. But Johnson is a law unto himself; the normal rules of politics do not seem to apply to him. Here are the main points the mayor made:

•Johnson was less than emphatic when asked why Sir Paul Stephenson should resign over his links to Neil Wallis but David Cameron should not over his links to Andy Coulson. "This is a matter you must frankly direct to Number 10 Downing Street, and I suggest you ask them," he said. That will do little to stem consistent speculation that Johnson is after Cameron's job. Asked if he himself should resign, the mayor did not directly answer.

•The mayor made it clear that he felt his view of the phone-hacking affair had changed because "it became obvious the scandal was far worse than previously indicated" following the Guardian's Milly Dowler revelations. He would not apologise for saying last year that the story was "codswallop", but he did say: "Those who pursued the story have been completely right." He said he had taken John Yates at his word in 2009 when Yates told him there was no need to reopen the investigation.

•He repeated his praise for Rupert Murdoch for his role in the newspaper industry in the 1980s (presumably for breaking the unions) and as a pioneer in the satellite TV business.

•He praised both Stephenson and Yates. Their resignations were "regrettable" but the "right call". Nothing had been proven casting doubt on the probity or professionalism of either man, but, if they had continued in their posts, it would have been too distracting in the run-up to the Olympic games. But he had been "disappointed" to discover the relationship between the Met and the former News of the World executive editor Neil Wallis, who was arrested in the phone-hacking investigation on Friday.

•Johnson said it had not been proved that the NoW's relationship with the Met police had impeded the police investigation into the paper – but if it had the police and judicial inquiries would find out.

• Tim Godwin will replace Stephenson and Cressida Dick will replace Yates, he announced; both are interim appointments.

3.30pm:Theresa May, the home secretary, is about to make a statement in the Commons about phone hacking and the police.

3.32pm:Sir George Young, the leader of the Commons, is using a point of order to say that the government wants to have a full day's debate on Wednesday.

John Bercow, the Speaker, says he will agree to allow the recess to be postponed for a day.

• Government agrees to hold a full debate on Wednesday on phone hacking.

Photograph: Leon Neal/AFP/Getty Images

3.40pm:Theresa May is making her statement now. It will cover the resignations of Sir Paul Stephenson and John Yates, the phone hacking inquiry and the investigation into phone hacking.

May says she was sorry about Stephenson's resignation. The Met is stronger today than it was when he took over.

May has already started work the mayor of London and the MPA on an "orderly transition". Stephenson will leave his post as soon as possible. Tim Godwin will serve as acting commissioner. Bernard Hogan-Howe will replace Godwin as acting deputy commissioner.

Cressida Dick will replace John Yates.

Operation Weeting, the inquiry into phone hacking, is proceeding apace, she says.

Operation Elveden, the inquiry into payments to police officers, is supervised by the independent police complaints commission, she says.

Elizabeth Filkin, the former parliamentary commissioner for standards, will lead an inquiry into the ethical considerations that should guide police dealings with the media.

There will also be an inquiry by Her Majesty's Inspectorate of Constabulary into media contracts agreed by the Metropolitan police.

May concludes by saying that many Met officers serve the public bravely. An officer was short in the course of his duties only three days ago. It is for their sake that these inquiries need to be successful.

Photograph: Bloomberg/Bloomberg via Getty Images

3.49pm:Yvette Cooper, the shadow home secretary, is responding. She says May did not mention Neil Wallis. Sir Paul Stephenson resigned after it emerged that the Met had appointed Neil Wallis. But David Cameron hired Wallis's boss at the News of the World, Andy Coulson.

People will look at this and think it's one rule for the police and another for the prime minister.

May and Boris Johnson have refused to defend the appointment of Coulson. They have both forgotten what Coulson used to tell them to say: "We're all in this together."

Cooper says May should now insist on proper transparency in relation to all dealings between senior police officers and the media. These rules should cover social meetings, as well as official ones.

The government should also ditch its plans to have directly-elected police commissioners, she says.

3.55pm: George Osborne is sitting on the frontbench alongside Theresa May. He doesn't look very cheerful. He is credited with persuading David Cameron to hire Andy Coulson in the first place, which in Tory circles has meant his share price has taken a bit of a battering.

4.00pm:Alan Johnson, the former Labour home secretary, says that when he was at the Home Office, he did not know Neil Wallis had been appointed to work for the Met.

May says she did not know about this until last Thursday.

4.02pm: Labour's Jack Straw says Sir Paul Stephenson did not tell ministers about the fact that Neil Wallis had worked for the Met because of the conflict of interest within government. Why is May blaming the police, not government?

May says the Met did not tell the previous government that it had hired Wallis.

4.04pm: I've now got the full text of May's statement. By my count, she has announced a further three new inquiries related to phone hacking. She did not call them inquiries, but that seems to be what they are.

• An inquiry into the Met's relations with the media. This is the one headed by Elizabeth Filkin. She will examine examine "the ethical considerations that should, in future, underpin the relationships between the Metropolitan Police and the media, how to ensure maximum transparency and public confidence, and provide advice".

• An inquiry into police corruption generally. This will be carried out by Her Majesty's Inspectorate of Constabulary. It will "consider instances of undue influence, inappropriate contractual arrangements and other abuses of power in police relationships with the media and other parties" and make recommendations.• An inquiry into the independent police complaints commission. May said she had commissioned work - for did not say from whom - to see whether it needs new powers, including the power to question civilian witnesses. She also said that she would consider whether it needed the power to investigate institutional failings. At the moment it can only investigate allegations against individual officers.

We already have a judge-led inquiry into this affair, divided into two parts (one dealing with phone hacking and one dealing with media standards generally); two police inquiries (dealing with phone hacking and payments to the police); two select committee inquiries; and a News Corporation inquiry (see 3.11pm). By my count, we now have 10 inquiries covering this story.

That'll keep us all busy ...

4.17pm: Back in the Commons, two Labour MPs have now said that David Cameron should resign. Sir Gerald Kaufman said Cameron should "consider his position". And Dennis Skinner said "dodgy Dave" should "do the decent thing and resign".

The website's respected guru Mike Smithson reports that Ladbrokes has tightened the price on Cameron's being the next cabinet member to quit the government from 100/1 ten days ago to 12/1 now. Stan James offers 7/1 against Cameron not lasting the year.

Of the frontrunners to replace Cameron, David Davis represents "outstanding value" at 33/1, and Smithson has put some money down. Boris Johnson is top of the heap at 4/1, despite his not being an MP. Paul's own tip to replace Cameron would be William Hague, whose reputation and image as a statesman have steadily and markedly improved since he was last Tory leader – give or take a few embarrassing stories about his sleeping arrangements.

4.29pm: Outside the Commons chamber Nick Clegg (left) has rejected claims that David Cameron should resign over the appointment of Andy Coulson. Clegg defended Cameron much more robustly than Boris Johnson who - as Paul Owen reports at 3.28pm - dodged the question when asked why Sir Paul Stephenson should have to resign over the appointment of a former News of the World executive but not Cameron. According to PoliticsHome, this is what Clegg said when asked if Cameron should consider his position.

Absolutely not, of course not. Let's keep some perspective here. The fears that people have about what's gone on at the Metropolitan police is that a criminal investigation may have been compromised by the contacts between the police and the media. That will have unsettled many people but it's crucial people also know the police will continue to do their very important work to keep us safe.

4.38pm: My colleague Vikram Dodd tells me that the home affairs committee has Lord Macdonald, director of public prosecutions at at the time of the first phone hacking prosecution in 2007, to appear before it tomorrow in a special session. Macdonald has been criticised because he has subsequently agreed to do some work for News International.

4.42pm: Back in the Commons Labour's Chris Bryant asks Theresa May if she will ensure that there is a proper investigation into Surrey police, and what it did about the hacking of Milly Dowler's phone.

Are we talking about yet another inquiry? (See 4.04pm.) Thankfully not. May says this can be considered by the inquiry into corruption being carried out by the HM Inspectorate of Constabulary.

4.51pm: David Cameron has cut short his Africa trip for a second time to ensure that he can return to London early to deal with the phone hacking crisis, my colleague Nicholas Watt says. He's sent me this.

Frank Baron/Guardian

The prime minister will leave Nigeria earlier than planned Tuesday to allow him to prepare for his Commons statement on Wednesday. A visit to a power station and a drinks reception for the accompanying business delegation at the British High Commission in Lagos have been cancelled to allow Cameron to fly home tomorrow afternoon. It will allow the prime minister to return home late tonight rather than first thing tomorrow. Cameron will go ahead with a speech, a series of meetings with Nigerian government ministers and a visit to a GAVI vaccination centre in the morning. The prime minister had already cut his visit to Africa from four days to two.

5.00pm: I've tried to catch what Paul Dacre has been telling the joint committee on the draft defamation bill, but the parliamentary video feed is on the blink. Never mind. Paul Waugh is watching. Here's his most recent Twitter post.

5.07pm: The parliamentary website may be on the blink, but you can watch Paul Dacre's evidence to the joint committee on the draft defamation bill on the BBC's Democracy Live site.

5.19pm: Paul Dacre has just told the joint committee on the defamation bill that the Daily Mail has never published a story to his knowledge based on a hacked message.

5.23pm: John Yates has just given a public statement about his resignation. Here are the key points.• Yates said that he had acted "with complete integrity" and that his conscience was clear.

• He said that "ill-informed" and occasional "downright malicious gossip" was making it impossible for him to carry on doing his counter-terrorism job.• He said that he looked forward to the inquiry showing that he behaved properly when he reviewed the phone hacking case in 2009.

5.45pm: Here is the full text of John Yates's resignation statement.

Earlier on this afternoon I informed the Home Secretary, the mayor of London and the chair of the police authority of my intention to resign as assistant commissioner of the Metropolitan Police Service. It is with great regret that I make this decision after nearly 30 years as a police officer.

I wish to pay tribute to the many fine officers and police staff with whom I have served. I will miss them hugely, but I know that they will continue to do their utmost to protect the public and, of course, this great capital city.

We in the police service are truly accountable. Those of us who take on the most difficult jobs clearly have to stand up and be counted when things go wrong. However, when we get things wrong, we say so and try and put them right. As I have said very recently, it is a matter of great personal regret that those potentially affected by phone hacking were not dealt with appropriately.

Sadly, there continues to be a huge amount of inaccurate, ill-informed and on occasion downright malicious gossip published about me personally. This has the potential to be a significant distraction in my current role as the national lead for counter-terrorism. I see no prospect of this improving in the coming weeks and months as we approach one of the most important events in the history of the Metropolitan Police Service, the 2012 Olympic Games. The threats that we face in the modern world are such that I would never forgive myself if I was unable to give total commitment to the task of protecting London and the country during this period. I simply cannot let this situation continue.

It is a matter of great personal frustration that despite my efforts, on a number of occasions, to explain the true facts surrounding my role in these matters since 2009, there remains confusion about what exactly took place. I have acted with complete integrity and my conscience is clear. I look forward to the future judge-led inquiry where my role will be examined in a proper and calmer environment and where my actions will be judged on the evidence rather than on innuendo and speculation, as they are at present.

5.47pm: Here's an afternoon summary.

• The independent police complaints commission has announced that it is investigating an allegation that John Yates helped the daughter of the former News of the World deputy editor Neil Wallis get a job in the Metropolitan police. The IPCC has also said it is investigating Yates's review of the phone hacking case in July 2009, and two other former senior officers involved in the original inquiry. According to the BBC, they are Peter Clarke and Andy Hayman. There are more details on the IPCC news release.

• John Yates has said that he acted "with complete integrity" and that his conscience was clear. In a statement about his resignation, he said that he was resigning because "downright malicious gossip" was making it impossible for him to carry on doing his counter-terrorism job. (See 5.45pm.)• Theresa May, the home secretary, has announced a wide-ranging inquiry into general police corruption. She has also called for two other reviews covering the Metropolitan police's relationship with the media and whether the independent police complaints commission needs new powers. (See 4.04pm.)

• Sir George Young, the leader of the Commons, has announced that there will be a full debate on phone hacking on Wednesday. The parliamentary recess is being delayed for a day to allow this to happen.

• Labour backbenchers Sir Gerald Kaufman and Dennis Skinner have said David Cameron should resign because of his decision to employ Andy Coulson. Boris Johnson dodged a question about whether he thought Cameron should resign, but Nick Clegg defended the prime minister robustly. Ed Miliband has just made it clear that the Labour frontbench is not demanding Cameron's resignation.

I'm finished for the day now. My colleague Ben Quinn will be taking over for the rest of the evening

Graphic

6.07pm: Good evening. This is Ben Quinn taking over the blog from Andy. You can follow me on twitter at BenQuinn75

Hoare, who worked on the Sun and the News of the World with Coulson before being dismissed for drink and drugs problems, is said to have been found dead at his Watford home.

Hertfordshire police would not confirm his identity, but the force said in a statement: "At 10.40am today [Monday 18 July] police were called to Langley Road, Watford, following the concerns for welfare of a man who lives at an address on the street. Upon police and ambulance arrival at a property, the body of a man was found.The man was pronounced dead at the scene shortly after.

"The death is currently being treated as unexplained, but not thought to be suspicious. Police investigations into this incident are ongoing."

6.14pm: Hoare first made his claims in a New York Times investigation into the phone-hacking allegations at the News of the World.

6.17pm: Hoare told the New York Times that not only did Coulson know of the phone-hacking, but that he actively encouraged his staff to intercept the phone calls of celebrities in the pursuit of exclusives.

In a subsequent interview with the BBC he alleged that he was personally asked by his then-editor, Coulson, to tap into phones. In an interview with the PM programme he said Coulson's insistence that he didn't know about the practice was "a lie, it is simply a lie".

At the time a Downing Street spokeswoman said Coulson totally and utterly denied the allegations and said he had "never condoned the use of phone-hacking and nor do I have any recollection of incidences where phone-hacking took place".

Sean Hoare. Photograph: BBC

Hoare, a one-time close friend of Coulson's, told the New York Times the two men first worked together at the Sun, where, Hoare said, he played tape recordings of hacked messages for Coulson.

At the News of the World, Hoare said he continued to inform Coulson of his activities. Coulson "actively encouraged me to do it," Hoare said.

In September last year he was interviewed under caution by police over his claims that the former Tory communications chief asked him to hack into phones when he was editor of the paper, but declined to make any comment.

6.41pm: Here is some more on the announcement by the Independent Police Complaints Commission (IPCC) that it is investigating an allegation that John Yates helped the daughter of the former News of the World deputy editor Neil Wallis get a job in the Metropolitan police.

The Press Association reports:

The IPCC has been asked to look into Sir Paul's actions as the officer with overall responsibility for Scotland Yard's investigation into phone hacking at the News of the World.

It is also considering Mr Yates's decision in 2009 that there was no need to re-open the hacking inquiry and allegations that he inappropriately secured a job for a friend's daughter.

The IPCC refused to give any more details about the details of the referral.The Metropolitan Police Authority has also asked the watchdog to examine the conduct of two former senior Met officers involved in the original phone-hacking investigation.

It is understood they are ex-assistant commissioner Andy Hayman, who was in ultimate charge of the 2006 inquiry and later become a columnist with News International title The Times, and ex-deputy assistant commissioner Peter Clarke, who oversaw the investigation.

6.45pm: The IPCC deputy chair Deborah Glass has said in a statement that the role of the Metropolitan Police in its original investigation into phone hacking "has rightly come under huge public scrutiny".

She added:

These matters are already the subject of a judge-led public inquiry announced on July 13 which is looking into the way in which police investigated allegations of conduct by persons connected to News International.

I now need to assess these referrals carefully to determine what should be investigated at this stage, bearing in mind the judicial inquiry, and I will seek to liaise with Lord Justice Leveson as soon as possible.

I will publish our terms of reference once I have carefully reviewed the material referred to us.

To the extent that these referrals raise serious allegations about senior Met officers, it is right that they be independently investigated - and I will ensure that our investigation follows the evidence without fear or favour."

It must also be right that people do not rush to judgment until that work is done.

6.52pm: Over at Channel 4 News, Jon Snow has said in his 'snowmail' that this evening's programme will have "a major exclusive" on a BBC Crimewatch presenter and former detective who says she was "targeted" by the News of the World.

She told Channel 4's Andy Davies that it was like 'being hunted', according to Snow. I'll bring you more on that as it develops.

7.01pm: The Met has issued a statement following the IPCC announcement (see 6.41pm).

The Met said:

The MPS was informed by the Metropolitan Police Authority, after their professional standards sub-committee meeting this morning, that they had decided to make a referral to the Independent Police Complaints Commission.

We weren't aware that there was complaint against the commissioner prior to this notification.

We understand the IPCC are now considering the referrals of Sir Paul Stephenson, John Yates and two ex-officers.

7.11pm: The political fall-out from the hacking scandal - and its potential impact on Cameron - has been giving the City the jitters.

Larry Elliott, the Guardian's economics editor, has passed this on:

Lloyds, Royal Bank of Scotland and Barclays were the biggest fallers on the FTSE 100 Index, all losing at least 6% of their value as jittery investors digested the results of Friday's stress tests on European banks, mulled the prospect of the US losing its triple A credit rating and began to worry about the political ramifications of the News International hacking scandal for David Cameron.

Michael Derks, Chief Strategist at FxPro, said: "Thus far, the pound has not factored in any real risk premium for political uncertainty. Given the rapidity with which key figures in the scandal are falling on their swords, it could be argued that the pound is being complacent regarding the potential of the hacking issue to ensnare the Prime Minister and his party."

At a time when the reputation of News of the World journalists is at rock bottom, writes Nick, it needs to be said that Sean Hoare was a lovely man. Here is some more from that piece:

guardian.co.uk

In the saga of the phone-hacking scandal, he distinguished himself by being the first former NoW journalist to come out on the record, telling the New York Times last year that his former friend and editor, Andy Coulson, had actively encouraged him to hack into voicemail.

That took courage. But he had a particularly powerful motive for speaking. He knew how destructive the News of the World could be, not just for the targets of its exposés, but also for the ordinary journalists who worked there, who got caught up in its remorseless drive for headlines.

Explaining why he had spoken out, he told me: "I want to right a wrong, lift the lid on it, the whole culture. I know, we all know, that the hacking and other stuff is endemic. Because there is so much intimidation. In the newsroom, you have people being fired, breaking down in tears, hitting the bottle."

He knew this very well, because he was himself a victim of the News of the World. As a showbusiness reporter, he had lived what he was happy to call a privileged life. But the reality had ruined his physical health: "I was paid to go out and take drugs with rock stars – get drunk with them, take pills with them, take cocaine with them. It was so competitive. You are going to go beyond the call of duty. You are going to do things that no sane man would do. You're in a machine."

8.02pm: A former BBC Crimewatch presenter and police officer has been telling Channel 4 news about her experience of being put under surveillance by private investigators with alleged links to News International.

Jacqui Hames, who Channel 4 News said was preparing to sue News International, said she believed that a range of her personal details was sold to the News of the World by a police officer.

She said that she was called two months ago by Scotland Yard to inform her that her details had shown up in papers belonging to Glenn Mulcaire, a private investigator working for the News of the World.

"I sat there and read the extent to which he had delved into my private life. It was a body blow," Hames told Channel 4 News' Home Affairs Correspondent Andy Davies.

She believes that the details - which included her homes address, mobile phone number, police warrant number and payroll number - could only have been passed on by another police officer.

The surveillance dates back to 2002 after her then husband, a senior murder squad officer, Detective Chief Superintendent David Cook appeared on BBC Crimewatch on June 26 2002, when he appealed for information to solve the murder of Daniel Morgan, who had been found dead in south London five years earlier.

A Guardian investigation has previously suggested that the surveillance of Cook involved the News of the World in physically following him and his young children, 'blagging' his personal details from confidential police databases, attempting to access his voicemail and that of his wife, and possibly sending a 'Trojan horse' email in an attempt to steal information from his computer.

Hames told Channel 4 news that a Scotland Yard counter surveillance unit was deployed, but that she and her family had been living in fear.

8.17pm: Channel 4 News also had another nugget - their discovery that Alex Marunchak worked as an interpreter for the Met between 1980-2000 while still a reporter at the News of the World.

Marunchak, formerly head of the News of the World in Ireland, was on a list of interpreters for the Met between 1980 and 2000 and was providing Ukrainian interpretation for victims and suspects.

Such interpreters are supposedly strictly vetted and have to sign the official secrets act.

The Met said in a statement:

"We recognise that this may cause concern and that some professions may be incompatible with the role of an interpreter."

Asked by Baroness Hayter whether he had ever "countenanced" phone hacking or blagging – a phrase used to cover a range of techniques used to get hold of private information – in his 19 years at the Mail, Dacre said: "No."

Asked whether unlawful newsgathering techniques could ever be justified, he said: "Goodness me, deep waters. I have considerable sympathy that if there's a great public interest then those methods can be justified."

However, he added later: "I don't think you should ever use hacking or blagging as a [public interest] defence because they're criminal offences."

Dacre made the rare public appearance to give evidence before a joint Commons and Lords committee on the government's draft defamation bill.

Fleet Street's longest-serving editor and a longtime supporter of the Press Complaints Commission, conceded that the self-regulatory body needed to be "radically reformed". But he conceded that it was the "least imperfect system known to man".

8.34pm: Here are some of the tweets from today about Sean Hoare, whose name has been trending.

Highlights of the report by Jo Becker and Ravi Somaiya include claims that:

• By the middle of last year, News International's lawyers and some executives were urging that the company accept some responsibility but Rebekah Brooks, then Chief executive, disagreed. "Her behaviour all along has been resist, resist, resist," said one company official who spoke to the NY Times.

• Over the last several months, Brooks spearheaded a strategy that appeared to be designed to spread the blame across Fleet Street. Several former News of the World journalists said she asked them to dig up evidence of hacking. One said her target was not her own newspapers, but her rivals.

• Planning to come in to the UK earlier this to take charge of the crisis enveloping his company, Rupert Murdoch wanted to "fly commercial to London," so that he might be seen as a man of the people.

• Paul Dacre, editor of the Daily Mail, told his senior managers that he had received several reports from businesspeople, footballers and public relations agencies that News International executives Will Lewis and Simon Greenberg had encouraged them to investigate whether their phones had been hacked by Daily Mail newspapers.

• According to an account he relayed to his management team, Dacre confronted Brooks, telling her: "You are trying to tear down the entire industry". Lady Claudia Rothermere, the wife of the owner of The Daily Mail, also overheard Brooks saying at a dinner party that The Mail was just as culpable as The News of the World. "We didn't break the law," Lady Rothermere said, according to two sources who spoke to the NY Times. Brooks was said to have asked who Lady Rothermere thought she was, "Mother Teresa?"

9.26pm: Standard and Poor's have put News Corp on negative credit watch, according to the AFP news agency.

9.50pm: Detectives are examining a computer, paperwork and a phone found in a bin near the riverside London home of Rebekah Brooks, the former chief executive of News International.

The Guardian has learned that a bag containing the items was found in an underground car park in the Design Centre at the exclusive Chelsea Harbour development on Monday afternoon.

The car park, under a shopping centre, is yards from the gated apartment block where Brooks lives with her husband, a former racehorse trainer and close friend of the prime minister David Cameron.

It is understood the bag was handed into security at around 3pm and that shortly afterwards, Brooks's husband, Charlie, arrived and tried to reclaim it. He was unable to prove the bag was his and the security guard refused to release it.

Instead, it is understood that the security guard called the police. In less than half an hour, two marked police cars and an unmarked forensics car are said to have arrived at the scene.

Police are now examining CCTV footage taken in the car park to uncover who dropped the bag. Initial suspicions that there had been a break in at the Brooks' flat have been dismissed.

David Wilson, Charlie Brooks's official spokesman, told the Guardian that Charlie Brooks denies that the bag belonged to his wife. "Charlie has a bag which contains a laptop and papers which were private to him," said Wilson.

"They were nothing to do with Rebekah or the [phone-hacking] case."

Wilson said Charlie Brooks had left the bag with a friend who was returning it, but dropped it in the wrong part of the garage. When asked how the bag ended up in a bin he replied: "The suggestion is that a cleaner thought it was rubbish and put it in the bin." Wilson added: "Charlie was looking for it together with a couple of the building staff.

"Charlie was told it had gone to security, by which stage they [security] had already called the police to say they had found something.

"The police took it away. Charlie's lawyers got in touch with the police to say they could take a look at the computer but they'd see there was nothing relevant to them on it. He's expecting the stuff back forthwith."

Rebekah Brooks was arrested on Sunday under suspicion of conspiring to intercept communications, and of corrupting police officers. She is due to appear before the Commons culture, media and sport select committee today on Tuesday afternoon.

10.00pm: Three Police officers carrying cameras and wearing white forensic suits arrived a short time ago at Sean Hoare's flat in Watford.

Fifteen minutes earlier, at about 9.15pm, a police van marked "Scientific Services Unit" pulled up at the address, a block of flats that the journalist moved into in November 2009.

The Press Association reports that two officers emerged carrying evidence bags, clipboards, torches and laptop-style bags and entered the building.

10.02pm: Ben Proctor, who worked with Sean Hoare over many years and was most recently deputy editor of the People, has been in touch to pay tribute. He said:

Sean Hoare was an old fashioned Fleet Street character, always in the pub but always with a story.

At his best he was a match for anyone and worked his contacts book to great effect.He was much loved by all those he dealt with and was imbued with an incredible earthy charm.

Like a cross between Arthur Daley and Del Trotter you could always rely on Sean to persuade people to part with the facts. He loved covering the showbiz beat and was prolific during the era of the Spice Girls and Oasis.

Typically with Sean he managed to became close to Liam Gallagher. Liam even helped Sean's fledgling freelance career when the News of the World cut him adrift, offering to assist him with background info on a book about Oasis.

As far as I know the book never got written, although Sean did once show me an early draft, with many collect pictures and facts provided by Liam.

This was typical Sean, when I first met him he offered to break my knee caps over some 'creative differences', but another time when word went round I had a problem he was first to my home to lend support. I always loved him, everybody did.

10.06pm: Attorney General Dominic Grieve, who is visiting New Zealand, has been speaking to National Radio's Morning Report (the local equivalent of Today).

Toby Manhire, a former Guardian comment editor who is now based in New Zealand, says that Grieve insisted that "there was no suggestion of impropriety" on the part of Coulson when Cameron appointed him as his communications adviser.

"I think it's right to point out that as matters stand at the moment, Mr Coulson was retained by the prime minister as an ex-editor of the News of the World at a time when there were absolutely no allegations against him that he had committed any wrongdoing ... There was no suggestion of any impropriety at that time on the part of Mr Coulson," he added.

He said the phone hacking scandal was "slightly peripheral to some of the main issues confronting the United Kingdom", and called for a "period of quiet".

He added: "Though clearly this is a challenging period for the prime minister, I don't see any threat to his leadership whatsoever."

10.46pm: In the US, News Corp shares have closed 4.3% lower tonight amid the turmoil engulfing its UK businesses. The conglomerate's shares are down 15% this month.

11.01pm: The hacking of the Sun's website appears to have claimed by Lulzsec.

The hacker group has attacked several high-profile websites over the last two months but announced last month that it is disbanding. The group has carried out attacks on companies such as Sony and Nintendo.

The Sun's website has now been taken down. Here is a screen grab we took earlier however:

Public Domain

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11.28pm: Visitors to www.thesun.co.uk are now being directed to LulzSec's twitter feed, 'The Lulz Boat'.

11.37pm: A News International spokeswoman has confirmed to the Press Association that the company was "aware" of what was happening, but made no further comment.

11.43pm: Charles Arthur, the Guardian's technology editor, has filed a piece on LulzSec's hack of the Sun's website.

The hacker collective also claimed to be "sitting on their [the Sun's] emails" and that they would release them on Tuesday.

According to Charles, the episode demonstrated that News International's systems have been vulnerable to hackers for some time. Rumours had surfaced that the hacking collective Anonymous would hit the site last week, but nothing appeared to come of it.

"We have owned Sun/News of the World – that [Murdoch] story is simply phase 1 – expect the lulz [laughs] to flow in coming days," Topiary tweeted from the LulzSec account.

12.02am: Dominic Rushe, the Guardian's US business correspondent, has filed an update from New York on the continuing impact of the hacking scandal on News Corp's corporate health.

The company's independent directors are pushing for Rupert Murdoch to clarify plans for his succession as they move to separate his UK problems from the News Corp's US business, according to Dominic, who adds:

Executives close to the company, who spoke anonymously, said independent News Corp executives have told Murdoch he needs to move quickly to allay shareholder fears that the hacking scandal will spread to the US business.

News Corp's News International stable of UK newspapers, including the now closed News of the World, represents a small part of the media firm's business. News Corp also owns the Fox TV network and 20th Century Fox film studio.

The phone-hacking scandal has already wiped billions off News Corp's value. Shares have fallen to $14.97 from $18.34 at the end of May before the scandal began. They fell again on Monday as shareholders sold out on the first day of trading following news that former News International chief executive Rebekah Brooks had been arrested over the weekend.

Credit rating agency Standard & Poor's warned News Corp Monday that its credit rating could be cut as the firestorm over the phone hacking scandal threatened to claim more victims.

Claire Enders, founder and chief executive of media researcher Enders Analysis, said there were many factions within the News Corp shareholders. She said there was a strong group that would like to see Chase Carey, News Corp's chief operating officer, officially designated as Murdoch's successor. "For them this is a great opportunity," she said.

Shareholders were closely watching how Rupert Murdoch and his son James answer questions about the scandal in parliament tomorrow. But Enders said it would be foolish to write off the Murdochs. "Right now everyone is holding their breath," she said.

In the US she said there was "a lot of sturm und drang" but as yet no concrete evidence that the scandal would hit the US business.

"The stock price is collapsing. There's a lot of disquiet among shareholders, but it is all wait and see," she said.

Enders predicted News Corp's shares would bounce back sharply if Chase was named successor.

12.31am: A range of News International sites seem to be feeling the impact of the cyber attack that initially wrecked the Sun's website.

The sites, www.thesun.co.uk, www.thetimes.co.uk, www.thetimes.co.uk and www.thesun.co.uk, all appear to be down.

12.37am:James Ball, a data journalist working for the Guardian investigations team, has been live-tweeting for the past couple of hours on the hacking of News International sites.

• Sean Hoare, the former News of the World showbusiness reporter who was the first named journalist to allege that Andy Coulson was aware of phone hacking by his staff, has been found dead.Hoare, who worked on the Sun and the News of the World with Coulson before being dismissed for drink and drugs problems, was said to have been found at his Watford home.• John Yates has resigned as assistant commissioner of the Metropolitan Police Service. He said that he acted "with complete integrity" and that his conscience was clear. In a statement, he added that he was resigning because "downright malicious gossip" was making it impossible for him to carry on doing his counter-terrorism job.

• The Daily Mail has never knowingly published a story based on information gleaned from phone hacking or "blagging", the paper's editor, Paul Dacre, has told MPs.Dacre, the editor-in-chief of Daily Mail publisher Associated Newspapers, told a joint parliamentary select committee on defamation law reform that he had "absolutely not" published a story he knew was based on unlawfully-accessed material.

• News International websites for the Times and the Sun have been suspended after hackers targeted the Sun's web pages and redirected traffic to another page falsely reporting that Rupert Murdoch had been found dead.The LulzSec hacking collective hacked the tabloid's site, and also claimed to be "sitting on their [the Sun's] emails" and that they would release the emails on Tuesday. They tweeted what they claimed was Rebekah Brooks's email address, and said they knew her password combination.

• The independent police complaints commission has announced that it is investigating an allegation that John Yates helped the daughter of the former News of the World deputy editor Neil Wallis get a job in the Metropolitan police. The IPCC has also said it is investigating Yates's review of the phone hacking case in July 2009, and two other former senior officers involved in the original inquiry.

• Theresa May, the home secretary, has announced a wide-ranging inquiry into general police corruption. She has also called for two other reviews covering the Metropolitan police's relationship with the media and whether the independent police complaints commission needs new powers.

• Detectives are examining a computer, paperwork and a phone found in a bin near the riverside London home of Rebekah Brooks, the former chief executive of News International.The Guardian has learned that a bag containing the items was found in an underground car park in the Design Centre at the exclusive Chelsea Harbour development on Monday afternoon.

This blog is being wrapped up now. You can monitor all Guardian coverage of the phone-hacking scandal and its fall out here.